Key investment points: The company's operating income in 2008, 2009 and 2010 was 516.07 million yuan, 52.1703 million yuan, and 558.765 million yuan, respectively, and realized net profit of 48.7522 million yuan, 68.499 million yuan and 74.1898 million yuan respectively, showing a good development trend. Looking at the entire Roots blower industry, at present, the production capacity of domestic companies is mainly concentrated on low-end products. The company's products are mainly in the middle and high-end markets, due to relatively high entry barriers, the current industry pattern is relatively stable. With the continuous growth of leading enterprises, the current concentration of the industry is relatively high and stabilizing. According to statistics from the fan branch of the China General Machinery Industry Association, the top 5 companies in industry output value in 2007, 2008 and 2009 accounted for 78.9%, 79.78%, and 82.99%, respectively, of the industry's total output value. Certain oligopolistic attributes. As the company with the highest output value in the industry for 10 consecutive years, the company has obvious advantages in technology research and development, product quality and brand advantages, and market advantages. We made a profit forecast for the company based on the company's current situation and its future fund-raising production capacity. We estimate the company's EPS for this year to be 0.53 yuan and the EPS for 2012 to 0.57 yuan. Based on the current valuation situation of companies in the market that are relevant to the company's business, we believe that PE of about 20 times is reasonable for the company. Based on this calculation, the reasonable price range of the company's stock price is 9.54 yuan to 11.66 yuan, and the recommended price range is 8.59 yuan to 10.49 yuan. Risk warning: 1. Industry growth has declined significantly 2. Downstream demand structure has changed significantly 3. The progress of the company's fund-raising projects has fallen short of expectations 4. The risk of rising raw materials 5. Increased competition in the industry has led to a decline in the company's gross margin